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Mr. Wilshire: I beg to move amendment No. 18, in clause 1, page 2, line 14, after 'Authority', insert
', provided proper compensation is paid'.
I am sure that there is a simple answer in this case. I want to indicate to the Committee that I am not a total right-wing philistine in moving the amendment, which says that if one is going to remove somebody from their job, one should pay the proper compensation. I should have thought that that was a principle that commended itself to the Minister. I do not need to elaborate, except to say that I seek to protect the interests of somebody who is chucked out of their job.
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Mr. McNulty: Welcome to the Committee, Mr. Amess. I am sure that we will have as much fun today as we did in yesterday's Programming Sub-Committee. I look forward to working under your chairmanship.
Paragraph 3(3) of schedule 14 of the Transport Act 2000 states:
''If, when a person ceases to hold office as a member of the Authority, the Secretary of State determines that there are special circumstances which make it right that the person should receive compensation, the Authority shall pay such compensation as may be determined by the Secretary of State.''
If we abolish the SRA and transfer its functions, as we intend to do, we cannot leave that element on the statute book, because the SRA would then be authorised to compensate the members of its board whose positions were terminated in special circumstances. We are halfway there with what is already in legislation, with the notion of compensation—the hon. Member for Spelthorne is entirely right and the point is worth making—yet we cannot say that compensation should be paid in special circumstances, which the abolition would be, but that the SRA should pay it, because we are abolishing that as well. The proposals therefore draw in to the Secretary of State the power contained in schedule 14 of the 2000 Act. I give my assurance that we will interpret the demise of the SRA as a special circumstance, as outlined in the 2000 Act.
It is equally important that we should be allowed from time to time to decrease the SRA's board membership, as subsection (7) also says, because the board number is fixed in statute too. However, we will not take a big bang approach. There will not be a day between now and whatever date is fixed in the future on which someone flicks a switch and the SRA no longer exists and its assets, liabilities and so on are transferred. By definition, the process will taken place over time. We want the numbers on the board to reflect the SRA's residual functions as that process takes place. However, I take the point about compensation, which we feel is substantially covered in our proposals.
Mr. Knight: I welcome what the Minister has said thus far. Can he confirm that he is saying that, where someone is under contract and that contract has certain provisions relating to its termination, those contractual terms will be honoured?
Mr. McNulty: Within the context of the amendment, of course I am. In the broader sense, there will be other cases involving the transfer of the SRA's liabilities and assets where contract law will prevail. The amendment refers to subsection (7)(a) and concerns membership of the SRA board. We want to roll forward what prevails in the 2000 Act, because the point that the hon. Member for Spelthorne made is entirely fair.
The issue also concerns numbers. Under the 2000 Act, we are obliged to ensure that the SRA board consists of at least eight members and no more than 15. It is possible to amend that by order, and the current membership is 11. However, once the transfer of
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functions, assets and liabilities is in train, the role of the board will become moot. We therefore want the board to diminish as part of the process.
The compensation elements that the hon. Member for Spelthorne mentioned are covered in schedule 14 of the 2000 Act and I am happy to give a commitment that ''special circumstances'', as outlined in those provisions, would include, I assume, the demise of the SRA.
Mr. Chope: What is the Minister's estimate of the likely total bill for compensation?
Mr. McNulty: Given that the current membership is 11 and that at some stage we would like to get it down to zero, I suspect that the answer will depend on the speed at which we move from 11 to zero. If we did that tomorrow, the answer would be 11 times whatever is the proper compensation for those 11 individual members of the board. If it is done over time, the compensation package will be either more or less, although I have not thoroughly investigated the root and branch details; it will be whatever the optimum compensation package is under paragraph 2(3) of schedule 14 to the Transport Act 2000 times 11. What we are not going to do is increase the membership of the SRA to 15 at a time when we seek the diminution of its role and its ultimate demise. That may sound like Sir Humphrey, but that is the best answer that I can come up with. It is 11 times whatever is the current package.
Mr. Knight: I do not criticize the Minister for not having the figures at his fingertips, because they obviously involve complex calculations. Is he prepared to give the Committee an outline of the figures, either in a future sitting or by letter, bearing in mind that he must know at some point how quickly he wants to proceed with abolition?
Mr. McNulty: That is a fair point. To the extent that I am committed to ensuring that the Committee and the House are given as much detail as possible about the non-legislative dimensions of the policy as well as the legislative ones, that seems perfectly in order. The only caveat is that specific, individual circumstances to do with length of time served and a range of other elements may affect the compensation package. If I can at least get ball park figures for what the compensation element might be, however, and at what stage the 11 will go down to a residual board as a prelude to its ultimate demise, I will happily share them with the Committee. In that context, I ask that the amendment be withdrawn.
Mr. Field: The amendment is interesting. I am keen for the Minister's confirmation that any compensation arrangements will be made public. The rail industry has clearly been subject to controversy, not least with the renationalisation of Railtrack some three years ago. As a result, it seems that books are likely to be written and stories told not only by members of the SRA but, more interestingly, by former rail regulators, that could be of commercial value. As a result, I
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suspect that some sort of confidentiality arrangement is likely to be part and parcel of any compensation arrangements.
It is certainly my understanding that the erstwhile rail regulator, Tom Winsor, was put under some pressure to resign at one point, and substantial compensation packages were bandied around in what might be called a quasi-offer, if not a fully fledged offer, that were well in excess of what might be considered normal. I understand that that gentleman is likely to write a book about his experiences as rail regulator both before and after the October 2001 decision to renationalise Railtrack and about the expensive mess that our rail industry got itself into over the past few years.
We are likely to see somewhat less dispute in relation to the Strategic Rail Authority. One hopes that when it is wound down from 11 members to zero, its members will be less likely to wish to sell their stories. Given the concern that has been expressed, however, it is important that the compensation arrangements are made entirely public and that we know on what basis they are made.
The Minister made it clear that he would try to give us some indication of the general arrangements, perhaps in writing. On the basis that one or two members of the SRA are likely to have been more deeply concerned with rail strategy over the past six or seven years, however, he will understand that the Opposition are concerned that if confidential compensation is put in place that takes account of the controversy that might emerge about the running of the railways over the past few years, that fact should be in the public domain.
On that basis, I hope that the Minister will at least give us some comfort; what we are discussing is an important factor, and in the context of abolishing a public body that has been controversial, it should not be ignored.
Mr. Wilshire: Well, well; an amendment of mine has not had abuse dumped on it by the Minister. I must be on to something. We have heard his assurances, and this is a serious subject. Whatever we feel or think about an organisation, the people in it will have been doing the job to the best of their ability, and if a Government decide to wind it up, it is proper to observe all the normal courtesies and rules about compensating people who may have made assumptions about the length of their tenure. I have listened carefully to him and I am sure that the record will be sufficient ammunition, should something go wrong in future, in establishing clearly the Government's intention.
10.45 am
Mr. McNulty: I intervene on the hon. Gentleman purely to answer the question asked by his hon. Friend the Member for Cities of London and Westminster, rather than speaking again once he concludes. In the context of freedom of information and the caveats that I mentioned earlier about personal circumstances and personal conditions, I should say that if I can make public the compensation packages and announce
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when they are likely to be made available—perhaps there will be paperback rights to my lurid inside story of the SRA—I shall of course do so. I shall take advice and pursue the matter.
Mr. Wilshire: I am sure that my hon. Friend the Member for Cities of London and Westminster is grateful for that reassurance.
This brief debate has been about putting on the record what is needed for the future. I therefore do not see the need to press the amendment, but I am glad that we have had the opportunity to clear up a few matters. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
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